Trump Signals Progress in U.S., China Trade Spat

China’s State Council Tariff Commission said Aug. 23 that as of Dec. 15 it would reimpose 25% duties on a wide range of U.S.-made automobiles and parts – tariffs it had suspended in April.

Keith Nuthall, Director

August 27, 2019

3 Min Read
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U.S. automakers’ group urges continued U.S.-China trade talks.

President Donald Trump says at the G7 summit in Biarritz, France, that serious talks with China over resolving the ongoing trade war with that country are imminent.

This comes as the U.S. auto sector is voicing concern over the latest round of Chinese retaliatory tariffs announced last week. Claiming preparatory talks already have been staged, Trump says: “I think we’re going to have a deal, because now we’re dealing on proper terms. They understand and we understand.”

The new tariffs on U.S. vehicle and parts exports to China represent the latest round of the increasingly punishing trade war between Washington and Beijing.

China’s State Council Tariff Commission said Aug. 23 that as of Dec. 15 it would reimpose 25% duties on a wide range of U.S.-made automobiles and parts – tariffs it had suspended in April. It also announced a new list of 10% and 5% additional duties it would impose on another large list of autos and parts, mostly on the same day.

In its announcement, the tariff commission says this was a response to the U.S. government’s recent announcement of a 10% tariff on approximately $300 billion worth of goods imported from China, to be imposed Sept. 1 and Dec. 15.

The tariff commission says, “The U.S. measures have led to the continuous escalation of Sino-U.S. economic and trade frictions, which have greatly harmed the interests of China, the United States and other countries, and have also seriously threatened the multilateral trading system and the principle of free trade.”

A note from Asian business advisors Dezan Shira & Associates says: “The new tariffs represent an overall total value of about 10% of all U.S.-China bilateral trade, which…means that another $75 billion of that $180 billion is about to have new or additional tariffs imposed upon them – a significant burden for U.S. suppliers to China.”

Commenting on the latest developments, Matt Blunt, president of the American Automotive Policy Council, tells Wards: “In a global economy, it is imperative for American automakers and other manufacturers to have open access to overseas markets for U.S. products. America’s automakers urge the Trump administration to continue constructive discussions with China to seek a quick resolution with proactive dialogue.”

The Chinese commission released two lists of tariffs Aug. 23. Its Sept. 1 list includes 5% duties on U.S. tire exports to China.

But it is the Dec. 15 list that really targets the auto sector, imposing additional 10% duties on gasoline, diesel, electric and hybrid cars, trucks, larger passenger vehicles (from autos with 10 seats to buses with 30 or more seats), as well as large passenger-car frames, parts and accessories, plus light-truck frames.

China also that day will impose additional 5% duties on U.S.-made parts, including car radios, steering wheels, mufflers, sunroofs, car doors, brakes, gearboxes, axles and clutches, as well as cargo trailers.

In response, President Donald Trump reacted aggressively, with a tweet saying: “We don’t need China and, frankly, would be far better off without them. Our great American companies are hereby ordered to immediately start looking for an alternative to China, including bringing your companies HOME and making your products in the USA.”

As it stands, U.S. and Chinese negotiators are to meet in September for a new round of talks to resolve the trade war, although no date has been confirmed.

About the Author(s)

Keith Nuthall

Director, International News Services

Keith Nuthall is an experienced journalist who specializes in international regulation and policy. He is based in Canada and the UK. He is director of B2B publication media agency, International News Services Ltd (internationalnewservices.com)

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